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Step 1Shareholders' Equity denotes the net worth of the business and this can be arrived at by subtracting the outside liabilities from the total assets. Shareholders' Equity consists of Common Stock, Preferred Stock, and Retained Earnings. Treasury Stock is deducted from the Shareholders' Equity. Step 2 Statement of Financial Position As Of 31 December 2018Shareholder's equity SectionParticularsAmountOrdinary shares, authorized shares 500,000, issued share 52,000 shares @P50P2,600,0005% Preference shares, authorized shares 25,000, issued shares 15,000 @P100P1,500,000Share premium P1,350,000Less: Subscription receivableP(120,000)Retained earningsP1,550,000Share premium TreasuryP280,000Share premium-PreferenceP850,000Donated capitalP540,000Less: Treasury stock at cost-450 sharesP(40,000)Total shareholder's equityP8,510,000 ...